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Public Goods Generated by Intercollegiate Athletics

Title: Public Goods Generated by Intercollegiate Athletics: Student's Willingness-to-Pay Increased Athletic Fees.
Name(s): Howard, Mark Lindsey, author
James, Jeffrey D. (Jeffrey Dalton), professor directing dissertation
Isaac, R. Mark (Robert Mark), 1954-, university representative
Rodenberg, Ryan M., committee member
Newman, Joshua I., 1976-, committee member
Florida State University, degree granting institution
College of Education, degree granting college
Department of Sport Management, degree granting department
Type of Resource: text
Genre: Text
Issuance: monographic
Date Issued: 2016
Publisher: Florida State University
Place of Publication: Tallahassee, Florida
Physical Form: computer
online resource
Extent: 1 online resource (244 pages)
Language(s): English
Abstract/Description: While revenues have been increasing for a small percentage of National Collegiate Athletic Association (NCAA) football bowl subdivision (FBS) programs, the majority (82%), have seen a larger increase in expenses due to an attempt to compete within the intercollegiate athletic arena, in what has been deemed an “arms race” (Edwards, 1984; Brown, Rascher, Nagel, & McEvoy, 2010; Tsitsos & Nixon, 2012). This arms race has led many universities to spend money to keep up with larger conferences where budgets can exceed $100 million. Since 2004, "median total expenses have increased by over 120.6 percent" (Fulks, 2015, p. 12). After adjusting for inflation this percentage is even higher, showing an increase of 131.5% since 2004. Ticket sales and booster contributions have long been the mainstays of revenues for athletic departments (Fulks, 2015), with the continued increases in expenses there is a need to examine all avenues where potential revenues may exist. One potential revenue source can be found in the student body. Researchers have suggested community can be created by intercollegiate athletics, providing a “rallying point” (Clopton, 2007, p. 103). This community benefit could also be known as a psychic impact (income) which is the emotional impact from having the public good of intercollegiate athletics on a particular university campus. Psychic impact is a form of positive externality, which is a benefit, produced by the intercollegiate athletics programs in this case which cannot be captured by those in the athletic department or university who sell tickets and accept booster donations (Brown et al., 2010). A public good is a good that is non-rivalrous and non-excludable by nature, meaning that more consumption by one individual does not limit the availability of the good to be consumed by another and the consumer cannot be excluded from consuming the good (Taylor & Weerapana, 2010). Intercollegiate athletics exemplify this definition of public goods and since sports are a “socially-consumed commodity” (Sanderson, 1999, p. 189) there needs to be a way to measure the value of such an important commodity. Public goods are non-market goods. It can be difficult to place a value on their consumption since there is not a market price. According to Lipton, Wellman, Sheifer, and Weiher (1995) there are direct and indirect techniques to measure the value of a non-market good. The indirect approach relies on observations of behavior to determine the value of a product or service to a consumer, where the direct approach is to ask a consumer how much they are willing to pay (WTP) to consumer the desired product or service. Indirect measurement includes such techniques as the travel cost method, random utility models, and hedonic pricing techniques. The contingent valuation method (CVM) is the direct approach to measuring an individual’s WTP. The CVM is a survey based method which elicits a hypothetical scenario for consumers to place a monetary value on the overall WTP by extrapolating the results from the survey sample to the target population. While the CVM has been used in numerous studies within the sport management literature (Atkinson, Mourato, Szymanski, & Ozdemiroglu, 2008; Barros, 2002; Castellanos & Sanchez, 2007; Drayer & Shaprio, 2011; Fenn & Crooker, 2009; Groothuis, Johnson, & Whitehead, 2004; Harter, 2015; Johnson & Whitehead, 2000; Johnson, Whitehead, Mason, & Walker, 2007; Owen, 2006; Santo, 2007; Wicker, Hallmann, Breuer, & Feiler. 2012), researchers have not attempted to measure the public goods generated for an intercollegiate athletics department by examining the WTP of college students to pay increased athletic fees to support their institution’s athletics programs. This purpose of this dissertation was threefold: 1) First, to estimate the private consumption benefits current Florida State University (FSU) students derived from attending sporting events offered through the athletic department; 2) to estimate the public consumption benefits derived by current FSU students who do not attend sporting events; and 3) to estimate the total economic value (TEV) the student population of FSU assigns to the athletics department. An online questionnaire was modified from previous CVM literature to facilitate its use in a college athletics settings and with a sample of current college students. The survey underwent an examination by an expert panel and then a pilot test was conducted. Four research questions were examined and it was found that both respondents who did attend and those that did not attend FSU athletics sporting events did have a WTP to pay athletics fees, but their WTP did not match how much they currently pay in athletics fees. Additionally, it was found that those respondents who attend sporting events do have a higher WTP if they also consume the FSU Athletics Department through other means that are related to the public goods portion of the FSU Athletics Department. Finally, it was determined that the total WTP of the respondents is higher than the amount that students currently pay for athletics fees. Based on the evidence from the data analysis, it was found that: students do have a WTP to help support the FSU Athletics Department although it might not be to the amount that they currently pay in athletics fees; those who do not attend FSU sporting events do have an increase in their WTP the more they consume the public goods of the athletics department; and the total WTP is higher than the current amount the respondents pay in athletics fees.
Identifier: FSU_2016SU_Howard_fsu_0071E_13177 (IID)
Submitted Note: A Dissertation submitted to the Department of Sport Management in partial fulfillment of the requirements for the degree of Doctor of Philosophy.
Degree Awarded: Summer Semester 2016.
Date of Defense: June 30, 2016.
Keywords: College Athletics, Contingent Valuation Method, Public Goods, Willingness to pay
Bibliography Note: Includes bibliographical references.
Advisory Committee: Jeffrey D. James, Professor Directing Dissertation; Mark Isaac, University Representative; Ryan Rodenberg, Committee Member; Joshua Newman, Committee Member.
Subject(s): Economics
Sports administration
Persistent Link to This Record:
Owner Institution: FSU

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Howard, M. L. (2016). Public Goods Generated by Intercollegiate Athletics: Student's Willingness-to-Pay Increased Athletic Fees. Retrieved from